Close
  • Latest News
  • Artificial Intelligence
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
Read Down
Sign in
Close
Welcome!Log into your account
Forgot your password?
Read Down
Password recovery
Recover your password
Close
Search
Logo
Logo
  • Latest News
  • Artificial Intelligence
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
More
    Home Latest News

      Check 21: Playing at a Bank Near You!

      By
      David Morgenstern
      -
      October 28, 2004
      Share
      Facebook
      Twitter
      Linkedin

        eWEEK content and product recommendations are editorially independent. We may make money when you click on links to our partners. Learn More.

        The Check Clearing for the 21st Century Act, aka Check 21, went into effect Thursday, moving another financial process into the digital age.

        The act creates a new financial instrument, called an IRD (image replacement document). The IRD is a substitute digital document based on the scanned, original paper version. A bank now can accept the IRD, which has the same legal status for proof of payment as the original paper check. Instead of shipping physical checks all over the country as they do now, banks can know the check really is in the e-mail. .

        The Check 21 legislation was prompted in part by the savings available from a digital process. But it was the 9/11 terrorist attacks that really got things moving, when millions of uncashed checks sat on airport runways for days, which slowed down the flow of commerce.

        Consumers and businesses alike may need to accommodate changes coming with the legislation. Some people have relied upon the delay, or “the float,” when writing checks. This is the practice of mailing payments without having sufficient funds to cover the checks and hoping that when the check is processed, there will be funds in the account.

        Another emotional issue with Check 21 is the issue of archiving. Most physical checks will be destroyed, although exactly how or when has yet to be decided. Each bank will decide on its own procedure, since the disposal process wasnt mandated.

        But financial industry experts warn that the conversion of paper checks to digital images could significantly reduce a banks capacity to uncover fraud or prosecute fraud. The destruction of the original paper document, eliminating evidence of fraud, may cause legal wrangling when it comes time to prosecute future check-fraud cases.

        In addition, many banks plan to make digital check images available to their customers online. This could open the door to large-scale fraud, should these images ever be accessed.

        For example, in a Unisys Corp. white paper, “Is Your Check 21 Implementation a Fraud Hazard?,” author Ori Eisen relates how a check-fraud version of a phishing scam might work. The scam begins with a spoof e-mailing campaign intended to trick bank customers into disclosing their user names and login passwords.

        Using the fraudulently obtained user names and passwords, the perpetrators could retrieve customers monthly statements and check images. Then, they could create high-quality counterfeit checks that are nearly identical in appearance, drawn for an amount that is appropriate for the account, and bearing a scanned signature.

        Check out some of eWEEK.coms coverage of the Check 21 rollout and related issues here:

        • Experts Fear Check 21 Could Lead to Mass Fraud
        • Opinion: Check 21: Are We There Yet?
        • Technologies Help Banks with Check 21
        • Will Paper Checks Become Extinct?
        • Check 21 Rules Present Banks with New Challenges
        • QIF Importing Finally Nears Its End
        • Symantec Rolls Out Anti-Phishing Service

        Check out eWEEK.coms Finance Center at http://finance.eweek.com for the latest news, views and analysis on financial applications and services for the enterprise and small businesses.

        David Morgenstern
        David Morgenstern is Executive Editor/Special Projects of eWEEK. Previously, he served as the news editor of Ziff Davis Internet and editor for Ziff Davis' Storage Supersite.In 'the days,' he was an award-winning editor with the heralded MacWEEK newsweekly as well as eMediaweekly, a trade publication for managers of professional digital content creation.David has also worked on the vendor side of the industry, including companies offering professional displays and color-calibration technology, and Internet video.He can be reached here.
        Get the Free Newsletter!
        Subscribe to Daily Tech Insider for top news, trends & analysis
        This email address is invalid.
        Get the Free Newsletter!
        Subscribe to Daily Tech Insider for top news, trends & analysis
        This email address is invalid.

        MOST POPULAR ARTICLES

        Latest News

        Zeus Kerravala on Networking: Multicloud, 5G, and...

        James Maguire - December 16, 2022 0
        I spoke with Zeus Kerravala, industry analyst at ZK Research, about the rapid changes in enterprise networking, as tech advances and digital transformation prompt...
        Read more
        Applications

        Datadog President Amit Agarwal on Trends in...

        James Maguire - November 11, 2022 0
        I spoke with Amit Agarwal, President of Datadog, about infrastructure observability, from current trends to key challenges to the future of this rapidly growing...
        Read more
        Cloud

        IGEL CEO Jed Ayres on Edge and...

        James Maguire - June 14, 2022 0
        I spoke with Jed Ayres, CEO of IGEL, about the endpoint sector, and an open source OS for the cloud; we also spoke about...
        Read more
        Applications

        Kyndryl’s Nicolas Sekkaki on Handling AI and...

        James Maguire - November 9, 2022 0
        I spoke with Nicolas Sekkaki, Group Practice Leader for Applications, Data and AI at Kyndryl, about how companies can boost both their AI and...
        Read more
        IT Management

        Intuit’s Nhung Ho on AI for the...

        James Maguire - May 13, 2022 0
        I spoke with Nhung Ho, Vice President of AI at Intuit, about adoption of AI in the small and medium-sized business market, and how...
        Read more
        Logo

        eWeek has the latest technology news and analysis, buying guides, and product reviews for IT professionals and technology buyers. The site’s focus is on innovative solutions and covering in-depth technical content. eWeek stays on the cutting edge of technology news and IT trends through interviews and expert analysis. Gain insight from top innovators and thought leaders in the fields of IT, business, enterprise software, startups, and more.

        Facebook
        Linkedin
        RSS
        Twitter
        Youtube

        Advertisers

        Advertise with TechnologyAdvice on eWeek and our other IT-focused platforms.

        Advertise with Us

        Menu

        • About eWeek
        • Subscribe to our Newsletter
        • Latest News

        Our Brands

        • Privacy Policy
        • Terms
        • About
        • Contact
        • Advertise
        • Sitemap
        • California – Do Not Sell My Information

        Property of TechnologyAdvice.
        © 2022 TechnologyAdvice. All Rights Reserved

        Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.

        ×